Ponzi schemer Scott Rothstein's former law partner,
Stuart Rosenfeldt has agreed to settle a $10 million lawsuit against him for a
fraction of the complaint, only $1.6 million. The settlement was disclosed
Thursday in a settlement agreement filed in the bankruptcy of Rothstein and
Herbert Stettin, the bankruptcy trustee appointed to
recover assets for the benefit of victims defrauded by Scott Rothstein's $1.4
billion Ponzi scheme, filed
several more clawback suits seeking the return of funds spent by Rothstein
on expensive jewelry and exotic automobiles. The clawback...
The Ponzi Blog
by Kathy Bazoian Phelps on February 16, 2012, analyzed on the jury verdict of
$67 million in favor of Coquina Investments against TD Bank for its
participation in the Rothstein Ponzi scheme in Florida. Now two more bank settlements are being
reported in the news.
First, TD Bank...
"An under-appreciated evil of substantial
frauds . . . is how they pit their victims against one another." United
States v. Dreier , 682 F. Supp. 2d 417, 418 (S.D.N.Y. 2010).
In the typical Ponzi case, some victims may
employ strategies to seek advantage over other victims. These may...
On April 3, 2012,
Minnesota Governor Mark Dayton signed a new law, Chapter 151, House File 1384,
designed to protect nonprofits from having to pay back donations made by Ponzi
perpetrators and other fraudulent sources.
The new law actually restricts a trustee's recovery in three distinct
When a Ponzi
scheme breaks, the government rushes to forfeit the assets that constitute or
are derived from proceeds traceable to the crime. At the same time, creditors,
thinking that they had properly secured their claims, try to grab those very
same assets for themselves.
A recent decision out of...
It occasionally happens that a trustee seeks to avoid a
debtor's prepetition transfer of property as a fraudulent transfer and that
property is also subject to a government forfeiture proceeding. In that event,
can the trustee still follow the familiar path and file an adversary proceeding
Once again, the defense of in pari delicto has saved a defendant from a claim of professional
negligence in a Ponzi scheme case. This time the case is Peterson v. Winston & Strawn, LLP , 2012 U.S. Dist. LEXIS 147653
(N.D. Ill. Oct. 10, 2012). Ronald Peterson is the trustee of two hedge funds, Lancelot...
One of a receiver's duties in administering a Ponzi
scheme case is to commence appropriate litigation to avoid and recover property
that the Ponzi schemer fraudulently transferred to third parties. By law, a
receiver generally has the benefit of nationwide service to reach a defendant's